contract law essay

Advantages And Disadvantages Of Mediation ADR

Negotiation: is a bilateral dispute resolution process, is created to facilitate discussion between the parties. No third party is involved in negotiation. If the parties can’t resolve their problems on their own, their problem will remain unresolved and the parries must consider another process for resolution. In negotiation the parties provide their own process and resolve their own dispute and create their own rules. When negotiation is selected, the parties must compromise. Negotiation is two-sided.

The preparation requires the dispute to be evaluated by defining the problem, by investigating the facts, by researching the law, and by indentifying the interests of the parties. Since only the attorneys can represent the client, the paralegal will be present to assist the attorney and will not have an active role in the negotiation. Paralegals must understand how they should conduct themselves during the negotiations(what they should wear, where they should sit, what they should say, what questions they should answer, if any; and how they should communicate with their attorneys).

The process takes place in a private setting, and it’s informal. The process in negotiation provides an opportunity to discuss feelings, perception of the dispute, interests, and array of settlement options; also, it preserves the privacy of records and documents.

Once a solution is identified, and evaluated against the interests of both parties, a negotiation strategy must be considered. In position-based negotiation, the parties state their positions and negotiate from those positions. Interest-based negotiation focuses on the parties’ interests and range of solutions. It is not constructed around a single position offered by each party.

POSITION-BASED NEGOTIATION

INTEREST-BASED NEGOTIATION

The parties begin by stating their positions and then negotiate from those positions.

The parties begin by identifying the problem from their respective perspectives, then discussing their respective interests, followed by mutually developing a range of solutions.

If the parties negotiate an agreement, their agreement is a contract. The basis of a contract is two exchanges. Because a negotiated agreement is a contract, it is enforceable in the courts through a breach of contract action.

The outcome determined by the parties and it is based on the parties’ needs and interests and less on the law. In negotiation the outcome may encourage creative solutions since a negotiated agreement produces immediate results and resolves the dispute immediately. It eliminates all uncertainties as to outcome. A negotiate agreement is enforceable as a contract and the disputants will more than likely fulfill their promises. Also, in the outcome, the parties may not be able to agree; as a result, there will be no negotiated agreement.

THE ADVANTAGES AND DISADVANTAGES OF NEGOTIATION

Negotiation requires active participation by both parties. They must agree to participate

Without the cooperation of both parties, there can be no negotiation

The decision to negotiate is based on a party’s needs and interests and not on the law

Negotiation offers the parties complete flexibility

The parties can establish their own timetable and are not bound by the artificial constraints established by someone else

The parties establish their own rules

Negotiating an agreement will guarantee that transaction costs will be dramatically reduced

The parties are not required to reach an agreement

The parties control the process and the outcome

MEDIATION: uses a neutral third party to facilitate the discussion between the parties in an attempt to help the parties resolve their dispute. Private mediation may be selected before litigation is initiated. If the mediation does not produce a settlement, a party can file a complaint and begin the litigation process. If the parties resolve their disputes through mediation, they will terminate the litigation process by filing motions to dismiss with prejudice.

The decision to mediate requires actual consent and planning by both parties because a neutral third party will participate in the process.

Preparing for mediation requires rules to be selected (since mediation is private, the parties can draft their own rules), the selection of a mediator, the selection of timing and the setting for the mediation, and the preparation of the participants for their roles in the process.

The mediator’s opening comments introduce the parties to the mediation process

The parties’ opening statements present the facts and feelings as perceived by the parties

The mediator helps the parties negotiate and work toward an agreement

The mediator helps the parties refine and finalize their agreement

As more and more people choose this route over litigation, there is an increasing need for skilled mediators, and paralegals have a tremendous opportunity to fill this void by utilizing their analytical abilities and undergoing formal training in mediation. Because a mediator can be a non-attorney, this is one area that paralegals may consider for further professional.

THE ADVANTAGES AND DISADVANTAGES OF MEDIATION

The decision to mediate is based on personal or business factors and not on legal principles

Mediation can be a problem if one or both parties are withholding information

Another problem with mediation can arise if one party is very passive and likely to be bulldozed by the other

If mediation does not succeed, the parties may have wasted time and money on the process and still face the expenses of a trial

Mediation does not require a lawyer to be present during one or more of the sessions

Mediation is an extremely quick process

Even though there are normally no lawyers present at mediation, the agreement between the parties involved is legally binding in most judicial systems

With mediation, anything can be mediated. That means the smallest of disagreements, such as, a dispute over a water bill can be mediated

With mediation, the mediator that is hired is an outside party

Another disadvantage of mediation is that either party can withdraw from the proceedings at any time

Only one court appearance

Substantially reduced conflict and stress

Less costly than litigation

More control over the outcome of your case

Control over time and cost

Privacy

Direct communication between the parties

Voluntary process

Considers all family members

OVERVIEW: The process selection is by the parties; the parties control the scheduling, and the mediation can be scheduled before a case is filed or at any time after filing. The participants are the parties, the mediator, and depending on the mediation, the parties’ attorneys. The process takes place in a private setting and it’s informal with each party having an opportunity to discuss his or her perception of the dispute, his or her feelings, interests, and proposed solutions. It’s confidential and preserves the privacy of the parties’ records and documents. The outcome allows the parties to control the dispute outcome and encourages creative solutions. The outcome can also result in the immediate resolution of the dispute if the parties agree based on the parties’ interests and needs. It eliminates all uncertainties as to outcome. The agreement may be based on inadequate information; agreement is enforceable as a contract, and its promises will most likely be performed because they meet some of the parties’ needs and interests. If the parties are unable to agree, there will be no agreement and the dispute will continue.

ARBITRATION: Arbitration is a time-tested, cost-effective alternative to litigation. Arbitration is the submission of a dispute to one or more impartial persons for a final and binding decision, known as an "award." Awards are made in writing and are generally final and binding on the parties in the case. It involves a submission of a dispute to a neutral third party. A private arbitration proceeding is less informal than a trial.

The parties agree to arbitrate their dispute either before the dispute arises or after the dispute has arisen and they select the arbitrator, arbitration panel, or arbitration service provider and pay for the process.

The parties may negotiate the rules or they may delegate the formulation of the rules to the arbitration service, arbitrator, or the arbitration panel. An arbitration award may not be appealed. As a general rule party in private arbitration will be represented by an attorney. Arbitration guarantees the parties that their dispute will be resolved at the end of the process. Arbitration hearings are private and confidential.

Thus, the arbitrator usually decides that one side was right and the other wrong. They do not often go out of their way to develop new approaches for meeting the interests of both sides simultaneously, as a mediator would do, though if a win-win solution is apparent, the arbitrator would probably recommend it. If the parties are so angry with each other that they cannot communicate effectively, even with help, or cannot cooperate at all, arbitration is usually more effective than mediation. It is also more effective when the problem involves the determination of facts or interpretation of law.

The disadvantages of arbitration stem from the same characteristics. Arbitration is adversarial, thus it generally does nothing to create win-win solutions or improve relationships. Often it escalates a conflict; just as court-based adjudication is likely to do. In addition, arbitration takes decision making power away from the parties. This results in a resolution of the current conflict, but does nothing to help the parties learn how to resolve their own conflicts more effectively in the future, as does mediation

When the arbitration is over, the decisions of the arbitrators are final and not subject to appeal. If the parties are unhappy with the result, they cannot go to court to try again. The arbitrators' decisions can only be challenged under very limited circumstances—for example, if they can demonstrate that an arbitrator was biased. If they want to challenge an arbitrator's decision they must do so within three months or less in a "motion to vacate."

PROCESS

Pre-dispute: arbitration agreement

Dispute

Initiating arbitration

Negotiating

Selecting the arbitrator

Selecting the time and place

Preparing for the arbitration

The arbitration hearing

The arbitrator’s award

Appeal from the arbitrator’s award

ADVANTAGES OF ARBITRATION

Speedier resolution; however, there can be exceptions due to multiple parties, arbitrators, lawyers and litigation strategy

Less costly; however, there can be exceptions due to multiple parties,lawyers, arbitrators and litigation strategy

Exclusionary rules of evidence don’t apply; everything can come into evidence so long as relevant and non-cumulative

Not a public hearing; there is no public record of the proceedings.

Confidentiality is required of the arbitrator and by agreement the whole dispute and the resolution of it can be subject to confidentiality imposed on the parties, their experts and attorneys by so providing in the arbitration agreement.From defense point of view, there is less exposure to punitive damages and run away juries

A party may record a lis pendens even if there if an arbitration pending by filing a law suit and then holding the case in abeyance until the arbitration is resolved

The ability to get arbitrators who have arbitrator process expertise and specific subject matter expertise

Limited discovery because it is controlled by what the parties have agreed upon and it is all controlled by the arbitrator Often, the arbitration process is less adversarial than litigation which helps to maintain business relationships between the parties

DISADVANTAGES OF ARBITRATION

There is no right of appeal even if the arbitrator makes a mistake of fact or law. However, there are some limitations on that rule, the exact limitations are difficult to define, except in general terms, and are fact driven.

There is no right of discovery unless the arbitration agreement so provides or the parties stipulate to allow discovery or the arbitrator permits discovery

The arbitration process may not be fast and it may not be inexpensive, nparticularly when there is a panel of arbitrators. Unknown bias and competency of the arbitrator unless the arbitration agreement set up the qualifications or the organization that administers the arbitration, has pre-qualified the arbitrator.

There is no jury and from the claimant’s point of view that may be a serious drawback. An arbitrator may make an award based upon broad principles of “justice" and “equity" and not necessarily on rules of law or evidence. An arbitration award cannot be the basis of a claim for malicious prosecution.

Except in certain circumstances, non-signatories of the arbitration agreement cannot be compelled to arbitrate

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